Let’s examine some of the new tactics that stock market hackers have adopted by analyzing the activities of a high-profile cybercriminal organization. And as we’ll show you, there are concrete steps that change and law enforcement can take to counter hackers’ new tactics. While this is not a positive development, it shows that the measures adopted by the exchanges are effective enough to force hackers to adapt in the first place. Many exchanges now hold a lower percentage of funds on less secure hot wallets, require more withdrawal powers, and monitor transactions more closely for suspicious activity to catch hacks earlier.īut at the same time, the most prolific hackers have become more sophisticated both in how they perform the hacking and then launder their stolen funds. Hackers are responding to the security measures of the exchanges.Įxchanges have taken steps to better protect clients’ funds from attacks, and the sharp declines in the amount lost per hack show they have been successful. However, the mixed funds in the above table are categorized according to their ultimate goal after the mixing takes place. And as we will discover later, a small but significant portion of all stolen funds (and increasingly in 2019) are being passed through third-party mixers or CoinJoin wallets to hide their illegal origin. In such cases, there may still be an opportunity for law enforcement to confiscate stolen funds. However, a significant portion of the funds have not been spent, sometimes for years. Most of the funds stolen in currency attacks are sent to other exchanges, where they are probably cashed out. Using blockchain analysis, we can analyze the movements of funds stolen in hacks to get an idea of how hackers liquidate funds. While the increase in the number of individual attacks is alarming, data show that exchanges are getting better at limiting damage. Only 54% of the attacks we observed in 2019 earned more than $ 10 million compared to all hacks in 2018. Therefore, our total quantity estimates in swap attacks are probably a lower limit, but we believe it is not far from the true total.Ĭurrencies included: ADA, BCH, BTC, ETH, EOS, LTC, NANO, NEM, USDT, XRP and others (see table “Amount of Exchange Attacks 2019”.)Īs there were no more than $ 105 million hacks stolen from Coinbene, the average and median amount stolen per hack dropped significantly in 2019 after raising each of the previous three years. Under these restrictions, almost all of the attacks we didn’t include were on smaller exchanges for relatively low amounts of cryptocurrency. We have also excluded attacks that have been specifically reported to us, but we are confident that including them will not significantly distort the data we analyze here. This means that we do not include cases where exchanges’ user data is compromised but no cryptocurrency is stolen. We only included attacks where the amount stolen was measured and publicly approved by multiple sources.We did not take into account the situations of users exploiting a trade error, such as exit scams or pricing inconsistency that almost allowed a Synthetix user to exceed $ 1 billion in erroneous trades.We counted attacks that only allowed bad actors to access funds from exchanges, not payment processors, wallet providers, investment platforms or other types of services.We enumerated attacks involving exploitation of technical vulnerabilities as well as attacks carried out by social engineering or other forms of deception. Let us explain how we reached the final number of 2019 exchange attacks, given that other sources in the media and elsewhere may report different numbers: The value for the total USD stolen by years and the number of attacks.Ĭurrencies included: ADA, BCH, BTC, ETH, EOS, LTC, NANO, NEM, USDT, XRP and others (The value for the total USD stolen by years and the number of attacks).
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